WASHINGTON, June 5 (Reuters) - Data stolen from U.S. government computers by suspected Chinese hackers included security clearance information and background checks dating back three decades, U.S. officials said on Friday, underlining the scope of one of the largest known cyber attacks on federal networks.

The breach of computer systems of the Office of Personnel Management was disclosed on Thursday by the Obama administration, which said records of up to 4 million current and former federal employees may have been compromised.

Accusations by U.S. government sources of a Chinese role in the cyber attack, including possible state sponsorship, could further strain ties between Washington and Beijing. Tensions are already heightened over Chinese assertiveness in pursuit of territorial claims in the South China Sea.

The hacking also raises questions about how the United States would respond if it confirmed that the Chinese government was behind it.

Several U.S. officials, who requested anonymity, said the hackers were believed to have been based in China but that it was not yet known if the Chinese government or criminal elements were involved.

Another U.S. official said the breach was being investigated as a matter of national security, meaning it may have originated from a foreign government.

The cyber attack was among the most extensive thefts of information on the federal work force, and one U.S. defense official said it was clearly aimed at gaining valuable information for intelligence purposes.

"This is deep. The data goes back to 1985," a U.S. official said. "This means that they potentially have information about retirees, and they could know what they did after leaving government."

Access to data from OPM's computers, such as birth dates, Social Security numbers and bank information, could help hackers test potential passwords to other sites, including those with information about weapons systems, the official said.

"That could give them a huge advantage," the official said.

According to a U.S. House of Representatives memo seen by Reuters, OPM knows what types of data were exposed to the hackers but not what data was taken. The memo was sent to House staff by Chief Administrative Officer Ed Cassidy, whose office provides support services to the House, including cyber security services.

In addition, the State Department said in a memo to its employees that most of them had not been exposed to the breach because their data was not housed on the hacked OPM systems. Only those who had previously been employed by another federal agency may have been exposed, it said.

Investigators have linked the OPM breach to earlier thefts of personal data from millions of records at Anthem Inc , the second largest U.S. health insurer, and Premera Blue Cross, a healthcare services provider.

It was the second computer break-in in less than a year at OPM, the federal government's personnel office, and the latest in a string of cyber attacks on U.S. agencies, some of which have been blamed on Chinese hackers.

A Chinese Foreign Ministry spokesman said such accusations had been frequent of late and were irresponsible. Hacking attacks were often cross-border and hard to trace, he said.

White House spokesman Josh Earnest said, "It's not clear who the perpetrators are," but he noted that President Barack Obama and his aides regularly raise with their Chinese counterparts concerns about Chinese behavior in cyberspace.

Disclosure of the latest computer breach comes ahead of the annual U.S.-China Strategic and Economic Dialog scheduled for June 22-24 in Washington, D.C. Cyber security was already expected to be high on the agenda.

U.S. officials said the talks would proceed as scheduled, as would Obama's plans to host Chinese President Xi Jinping on a state visit to Washington in the fall.

U.S. LIKELY TO MOVE CAUTIOUSLY

At Friday's White House briefing, Earnest dodged the question of whether Washington might retaliate if it was determined that a state had been involved in the hacking.

In December, U.S. officials moved swiftly to accuse North Korea of being behind a high-profile attack on Sony over a movie depicting the assassination of North Korea's leader, and Obama vowed that the United States would respond.

Some lawmakers and defense officials want a more aggressive U.S. stance against cyber breaches, including legislation to strengthen U.S. cyber defenses. But the administration is likely to move cautiously in response to any Chinese role, mindful of the potential harm from escalating cyber warfare between the world's two biggest economies.

The Federal Bureau of Investigation has launched a probe of the OPM attack, and vowed that it would bring to account those responsible for the hacking.

OPM detected new malicious activity affecting its information systems in April and the Department of Homeland Security (DHS) said it concluded early in May that OPM's data had been compromised and about 4 million workers may have been affected.

Hackers hit OPM's IT systems and its data stored at the Department of the Interior's data center, a shared service center for federal agencies, a DHS official said on condition of anonymity.

Chinese hackers were also blamed for penetrating OPM's computer networks last year, The New York Times reported last July, citing unnamed U.S. officials.

James Lewis, a cyber security expert at the Center for Strategic and International Studies think tank, said the administration's disclosure of the hacking could be a signal to China of Washington's plan to push hard on cyber issues at this month's talks.

"The Chinese have been saying privately, and somewhat in public, that we want the summit to go really well. 'Let's not talk about espionage. Let's talk about how we can work together'," said Lewis, a former State Department official. "This might be a U.S. response to that: 'No, we are going to talk about espionage.'" (Additional reporting by Phil Stewart, David Brunnstrom, Julia Edwards, Roberta Rampton, David Lawder and Susan Cornwell; Editing by Jason Szep, Doina Chiacu, Toni Reinhold)

China’s Dangerous GameThe country's intensifying efforts to redraw maritime borders have its neighbors, and the U.S., fearing war. But does the aggression reflect a government growing in power—or one facing a crisis of legitimacy?

China's Rising Military: Now for the Hard Part243 Jun 5, 2015 10:12 AM EDT By Thomas J. Christensen We should take no comfort in the apparent sincerity of all the claimants. If all actors truly feel they are defending rightful claims against the revisionism of others, the chicken game of international security politics is more likely to lead to a deadly collision.

These disputes are fueled by historical victimhood narratives and postcolonial nationalism. For the countries involved, defending sovereignty claims and recovering allegedly stolen territories are core missions. China is no exception.

It’s unclear how many students used these fraudulent test scores to gain admission to American colleges and universities, and to therefore illegally obtain F1 Student Visas.

“These students were not only cheating their way into the university, they were also cheating their way through our nation’s immigration system,” said special agent John Kelleghan of Homeland Security Investigations in Philadelphia. “HSI will continue to protect our nation’s borders and work with our federal law enforcement partners to seek out those committing transnational crimes and bring them to justice.”

A federal grand jury in Pittsburgh issued an indictment on May 21 on 35 charges, including conspiracy, counterfeiting foreign passports, and defrauding the Educational Testing Services (ETS) and the College Board, according to U.S. Attorney David J. Hickton for the Western District of Pennsylvania.

If the defendants are found guilty, they face a maximum total sentence of 20 years in prison and hundreds of thousands of dollars in fines.

.............................

US colleges expelled thousands of Chinese students last year for bad grades and cheating

Peter Jacobs May 29, 2015, 12:15 PM

Roughly 8,000 Chinese students were expelled from US colleges and universities last year, predominantly for bad grades and cheating, according to a new report from WholeRen Education."Chinese students used to be considered top-notch but over the past five years their image has changed completely — wealthy kids who cheat," Chen Hang, chief development officer at WholeRen, told The Wall Street Journal's China Real Time blog.

WholeRen representatives pointed out to The Journal that "huge numbers" of Chinese students study at American schools each year, so a few thousand expulsions is not a terrible failure rate. According to recent surveys, around one-third of America's nearly 1 million international college students are from China.

However, WholeRen's numbers do not paint these students in a flattering light. According to the education company, 80.55% of Chinese students' dismissals "resulted from academic dishonesty or low academic performances," while just over 50% of the students had a GPA lower than a 2.0 — typically, a C.

The WholeRen report is in Chinese, but The Wall Street Journal pulled out some interesting details about the expulsions.

"More than half of the Chinese students expelled were from top 100 US universities, the survey found. Cheating at exams, plagiarism and finding other students to write papers for them were frequently cited as the specific causes of expulsion," The Journal reports.

*Last week, a federal grand jury indicted 15 Chinese nationals in a scheme in which they paid up to $6,000 for other people in the United States to take the SAT, the GRE, and other college and graduate school standardized entrance exams for them to help them gain entry into U.S. universities. They were charged in a conspiracy to defraud the College Board, which owns the tests, and the Educational Testing Service, which administers the tests. According to the indictment, “The conspirators had counterfeit Chinese passports made and sent to the United States, which were used by the imposters to defraud ETS administrators into believing that they were other people, namely the conspirators who would receive the benefit of the imposter’s test score for use at American colleges and universities.” Some of the defendants actually won admissions to U.S. schools; one was arrested last week at Northeastern University in Boston.

David Hickton, the U.S. attorney for the District of Western Pennsylvania, where most of the tests were taken, said in this New York Times story: “I would not want anyone to be left with the impression that that’s the sole country involved or the scope of it.”

*The ETS is withholding an undetermined number of scores from the May 2 administration of the SAT in Asian and possibly other countries because of cheating concerns. This was not an isolated incident; scores were withheld after every single SAT administration in the 2014-15 school year in Asia amid reports of sophisticated cheating networks in which students obtain questions in advance. This year was not isolated either; the same problem has marred SAT administrations overseas for years. For example, the scores from the entire May 2013 administration of the SAT and SAT Subject tests in South Korea were cancelled because of a leak of questions.

Asked about the scores, Tom Ewing, director of external affairs at the Educational Testing Service, said in an e-mail:

The College Board and its global test administration and security provider, Educational Testing Service (ETS), are dedicated to delivering valid, reliable test scores to colleges and universities. As a matter of course, we employ a range of procedures to prevent violations of our test administration and security policies.

We regularly identify and halt attempts to gain an unfair advantage. When an alleged security incident occurs, we conduct

a comprehensive investigation and statistical analyses to determine if a breach has occurred and take the necessary actions to ensure the integrity of that SAT administration.

Over the past year, with more than 4 million test takers around the globe, fewer than 5,000 scores have been cancelled after thorough investigation. Due to a reported test security violation, a small set of scores from the May SAT test are being delayed while we conduct our comprehensive investigation and statistical analyses.

SAT scores may be delayed for a variety of reasons. For each administration, there may be score delays anywhere in the world, including in the United States. The small number of scores delayed in the U.S. for the May 2015 SAT administration is consistent with a typical administration.

Score integrity is critical to the institutions receiving our scores, and following each administration we go to great lengths to confidently report valid scores. When we hold scores, we do so based on investigative actions and ensure that scores are only released once they have been validated through statistical analyses and other measures.

We will continue to enhance our test security measures while

keeping the SAT accessible and affordable – a commitment we have made to students across the globe and to our members in higher education.

There are periodic SAT cheating scandals that erupt in the United States – such as one in 2011 in Nassau County, N.Y., where a number of students from a handful of schools were accused of accepting payment or paying others to the the SAT and the ACT college entrance exams. In October 2011, Bernard Kaplan, principal of Great Neck North High School, told a state Senate hearing on the issue that “the procedures ETS uses to give the test are grossly inadequate in terms of security,” according to this New York Times story. College Board and ETS officials say they have improved security since then.

Yet sophisticated and lucrative overseas cheating networks thrive. How do they work? As I’ve reported before, the ETS and College Board use questions on overseas exams forms that have already been given in the United States, and this opens a door to cheating that goes beyond having other people take the test for a student.

The National Center for Fair and Open Testing, a nonprofit organization that advocates against the misuse of high-stakes standardized tests, has found that test-prep companies in Asia have been operating for years in various ways; they send compatriots to the United States to take tests and/or obtain test questions by memorizing them or obtaining them illegally, as well as by monitoring chat boards where students post questions.

Furthermore, on SAT days, these firms have people sit for the test at Asian sites in times zones several hours ahead, memorize questions and take a “bathroom break” to call or text questions that can e-mailed to clients or loaded on calculators students are permitted to use at test centers. Last October, Fiona Rees, president of the Overseas Association for College Admission Counseling, wrote in an e-mail to a Post reporter that she learned of “several cases where our members (not in China or Korea) found significant instances of student fraud — including a student with entire pages of the SAT scanned on the phone,” and she added that one student had “the entire test with answers and essay already completed.”

On May 1, two versions of an SAT exam were e-mailed separately to me and to FairTest, purportedly to be the tests American students were to take across the United States the following day, on May 2, and possibly by some students in Asia. FairTest says it has confirmed that many of the questions on the versions we received were on the May 2 test given in the United States.

Said Bob Schaeffer, public education director of FairTest:

Last week’s federal indictments of 15 people for their role in an international college admissions test cheating conspiracy again demonstrates that many well-to-do Asian families are willing to do whatever is necessary to get their children (often their eldest sons) into brand-name U.S. colleges. Along with many reports that cheating was widespread on all five SATs offered in Asia

during the current academic year and FairTest’s receipt of two “live” SAT forms before they were administered, the Department of Justice’s legal action is strong evidence of a fundamental breakdown in test security on College Board/ETS exams. Since it is not possible to tell which test-takers had prior access to actual test items or had imposters take the exam in their place, the validity and reliability of all recent SAT scores should be questioned.

And he said further: “No admissions office can be certain whether an applicant’s reported scores are an accurate reflection of test performance or were inflated through prior knowledge of test content or other improper behavior.”

More broadly, there are related issues involving the growing number of Chinese nationals applying to study in the United States that are challenging college admissions officers even as many American colleges and universities welcome these students in part because a majority can pay full tuition.

According to the Institute of International Education, there were in the 2013-14 academic year, 274,439 students from China studying in the United States – up 16.5 percent from. China remains the leading place of origin for students coming to the United States for the fifth – and Chinese students now make up 31 percent of international students studying in the United States. The number of undergraduate students from China is growing too.

But there are questions about how many of them get admitted to U.S. colleges. This 2014 Hechinger Report story reported that as many as 90 percent of recommendation letters for Chinese applicants to Western universities were falsified in 2011, according to the U.S. educational consulting firm Zinch China. It also said 70 percent of admissions essays were found to have been written by someone other than the applicants and half of secondary school transcripts were falsified.

It is reasonable to expect, then, that some of these students arrive at U.S. colleges unprepared to do the work because of language or other issues. This May 2015 Atlantic magazine story says a “startling number of Chinese students are getting kicked out of American colleges”:

According to a white paper published by WholeRen, a Pittsburgh-based consultancy, an estimated 8,000 students from China were expelled from universities and colleges across the United States in 2013-4. The vast majority of these students — around 80 percent — were removed due to cheating or failing their classes.

The 2014 Time story said that the SAT remains a pencil and paper exam and is not loaded onto computers that are connected to the Internet, so hacking into a system to get it is impossible. Clearly, that hasn’t stopped cheaters from finding other ways to get around the system.

Oct. 18 (Bloomberg) -- JPMorgan Chase & Co. has agreed to sell 1 Chase Manhattan Plaza, the tower built by David Rockefeller, to Fosun International Ltd., the investment arm of China’s biggest closely held industrial group, for $725 million.Fosun, which invests in properties, pharmaceuticals and steel, is buying the 60-story, 2.2 million square-foot, lower Manhattan tower, according to a statement it filed to Hong Kong’s stock exchange.China’s developers and companies are expanding in overseas property markets as the government maintains curbs on housing at home to cool prices. Greenland Holding Group Co., a Shanghai-based, state-owned developer, this month agreed to buy a 70 percent stake in a residential and commercial real estate project in Brooklyn.“There’s a lot of excess capital in China that needs a way out at the moment,” Simon Lo, Hong Kong-based executive director for Asia research and advisory at property broker Colliers International, said in a phone interview today. “Also, by investing in markets like New York, they believe they can gain from the recovery of the U.S. economy and real estate market.”

Gold has long represented the primary means of rebalancing trade surplus / deficits between nations. As a nation ran a trade surplus with another, the exporter ended up with an excess of the importer nations currency. The primary means to rebalance was for the exporter to transfer back to the importer nation it’s currency in exchange for gold. If this continued, the importing nations falling gold holdings would represent a weakening currency…which would mean higher prices to the importing nation and less purchasing of the exporting nations goods slowing down the trade imbalance. Since the advent of paper money until 1971, this had been the general method to rebalance.

Chinese Buy American Home ForeclosuresU.S. home market pulls in more Chinese buyers

China's great wall of cash is pouring into the struggling U.S. property market, from multi-million-dollar mansions on the West Coast to venerable hotels on the East Coast.

Buyers from mainland China and Hong Kong are snapping up luxury homes, often paying cash, in major U.S. cities such as New York, Los Angeles and San Francisco. They're coming by the dozens to buy foreclosed properties in downtrodden cities in Florida and Nevada. Chinese buyers are even starting to snap up pricey commercial buildings and hotels in Manhattan.Chinese interest in U.S. real estate began climbing during the U.S. housing meltdown, when plunging property prices made the U.S. a magnet for global buyers. Today, interest is growing as a rising yuan — up more than 8% since mid-2010 — gives the Chinese greater purchasing power, and the mainland's restrictions on property purchases encourages them to look overseas. With U.S. single-family home prices a third lower since 2006, the U.S. also compares favorably with other top markets for Chinese investment, such as the United Kingdom, Australia and Canada.

When Linda Vida sold her house in the Oakland hills this summer, she was hoping for a buyer who would live there, put kids in the local schools and “give back or participate in the community,” she says.However, “as is very typical these days, a woman from China paid all cash for the house, and is not going to live in it but is going to rent it out for a while,” said Vida, who moved to Colorado. The buyer, a professor in Shanghai, paid $1.022 million, $27,000 over the asking price, for the home on Bay Forest Drive.“In the end, she was the strongest buyer because she didn’t want to negotiate over nickel-and-dime things,” Vida said.ADVERTISINGAlthough the Bay Area has always attracted foreign home buyers, anecdotal evidence suggests that their numbers are growing, creating even more competition in areas where demand has far outstripped the supply of new homes. The boom is partly because of globalization, but mostly a result of the tremendous buildup of wealth in developing countries, especially China, which had 2.4 million millionaires in 2013, up 60 percent from the year before, according to the Boston Consulting Group.

Wealthy Chinese with a few million yuan to burn will spend billions on U.S. real estate in the years ahead, according to a report released Wednesday by CB Richard Ellis, a large global real estate firm.

The United States is the country of choice for China buyers. Canada and Australia come in next at No. 2 and No. 3 respectively. That rich Chinese individuals and savvy corporations are buying up real estate in world class cities is no surprise at this point.

News of new Chinese real estate deals are popping up every quarter. Similar moves happened with the Japanese back in the 1980s. Now it’s China’s turn. And by most estimates, they are snatching up high end real estate in Los Angeles, San Francisco and New York, in particular. In California, China is the third largest foreign buyer of real estate, following Mexico and people from the Philippines, according to Realtor.org.

China is building massive databases of Americans’ personal information by hacking government agencies and U.S. health-care companies, using a high-tech tactic to achieve an age-old goal of espionage: recruiting spies or gaining more information on an adversary, U.S. officials and analysts say.

Groups of hackers working for the Chinese government have compromised the networks of the Office of Personnel Management, which holds data on millions of current and former federal employees, as well as the health insurance giant Anthem, among other targets, the officials and researchers said.

“They’re definitely going after quite a bit of personnel information,” said Rich Barger, chief intelligence officer of ThreatConnect, a Northern Virginia cybersecurity firm. “We suspect they’re using it to understand more about who to target [for espionage], whether electronically or via human ­recruitment.”

[How the Internet became so vulnerable]

The targeting of large-scale data­bases is a relatively new tactic and is used by the Chinese government to further its ­intelligence-gathering, the officials and analysts say. It is government espionage, not commercial espionage, they say.

vidChina hacked into the federal government’s network, compromising four million current and former employees' information. The Post's Ellen Nakashima talks about what kind of national security risk this poses and why China wants this information. (Alice Li/The Washington Post)

“This is part of their strategic goal — to increase their intelligence collection via big-data theft and big-data aggregation,” said a U.S. government official who, like others, spoke on the condition of anonymity to discuss a sensitive topic. “It’s part of a strategic plan.”

One hack of OPM, which was disclosed by the government Thursday, dates at least to December, officials said. Earlier last year, OPM discovered a separate intrusion into a highly sensitive database that contains information on employees seeking or renewing security clearances and on their background investigations.

Once harvested, the data can be used to glean details about key government personnel and potential spy recruits, or to gain information useful for counter­intelligence. Records in OPM’s database of background investigations, for instance, could contain a complete history of where an individual has lived and all of his or her foreign contacts in, say, China. “So now the Chinese counterintelligence authorities know which American officials are meeting with which Chinese,” a China cyber and intelligence expert said.The data could help Chinese analysts do more effective targeting of individuals, said a former National Security Agency official. “They can find specific individuals they want to go after, family members,” he said.

The trend has emerged and accelerated over the past 12 to 18 months, the official said. An increase in Chinese capability has opened the way “for bigger data storage, for bigger data theft,” he said. “And when you can gain it in bulk, you take it in bulk.”

The Chinese government, he said, is making use of Chinese companies that specialize in aggregating large sets of data “to help them in sifting through” the information for useful details. “The analogy would be one of our intelligence organizations using Google, Yahoo, Accenture to aggregate data that we collected.”

China on Friday dismissed the allegation of hacking as “irresponsible and unscientific.”

Chinese Foreign Ministry spokesman Hong Lei said Beijing wanted to cooperate with other nations to build a peaceful and secure cyberspace.

“We wish the United States would not be full of suspicions, catching wind and shadows, but rather have a larger measure of trust and cooperation,” he told a regular news briefing,

OPM disclosed that the latest hack of one of its systems exposed personal data of up to 4 million current and former employees — the largest hack of federal employee data in recent years.

It is possible that officials as senior as Cabinet secretaries had their data exposed, a congressional aide said on a briefing call with government officials Friday.

U.S. officials privately said China was behind it. The stolen information included Social Security numbers and performance evaluations.

[What to do if you are a federal worker]

“This is an intelligence operation designed to help the Chinese government,” the China expert said. “It’s a new phase in an evolution of what they’re doing. It certainly requires greater sophistication on their part in terms of being able to take out this much data.”

Barger’s firm has turned up technical evidence that the same Chinese group is behind the hacks of Premera Blue Cross and Empire BlueCross, which were discovered at roughly the same time earlier this year.

The first OPM incident has been linked to the health-care hacks by Barger and another security researcher, John Hultquist, senior manager for cyberespionage threat intelligence at iSight Partners. Hultquist said the same group is responsible for all of them, and for other intrusions into commercial databases containing large sets of Americans’ personal information.

“They would leverage this data to get to diplomatic, political, military and economic intelligence that they typically target,” said Hultquist, who declined to comment on who was behind the attacks.

Though much Chinese cyber­espionage is attributed to the People’s Liberation Army, these hacks, Barger said, appeared to be linked to the Ministry of State Security, which is a spy agency responsible for foreign espionage and domestic counterintelligence.

Other Chinese entities, including the military, may also be involved in the campaign, analysts said.

Chinese government hackers “are like a vacuum cleaner” in sucking up information electronically, said Robert “Bear” Bryant, a former top counterespionage official in the government. “They’re becoming much more sophisticated in tying it all together. And they’re trying to harm us.”

[Why the Internet’s massive flaws never get fixed]

Security researchers have pointed to a cyber tool or family of malicious software called Derusbi that has been linked exclusively to Chinese actors. One group that has used Derusbi is Deep Panda, a name coined by the firm CrowdStrike, which has linked that group to the Anthem hack.

Disclosed in February, that incident exposed the Social Security numbers, addresses, phone numbers, e-mail addresses and member IDs of tens of millions of customers. No medical data such as diagnosis or treatment information was compromised, the company said.

Researchers note that in contrast to the hacks of Home Depot and Target, personal data that might have been stolen from OPM, Anthem and the other companies has not shown up on the black market, where it can be sold to identity thieves. That is another sign, they said, that the intrusions are not being made for commercial purposes.

“Usually if there’s a criminally or financially motivated breach like that, we see the data making its way into the black market soon after that,” Barger said.

The big-data approach being taken by the Chinese might seem to mirror techniques used abroad by the NSA, which has come under scrutiny for its data-gathering practices under executive authority. But in China, the authorities do not tolerate public debate over the proper limits of large-scale spying in the digital age.

“This is what all intelligence services do if they’re good,” said the China cyber expert. “If you want to find a needle, first you have to gather a haystack of needles.”

The massive data harvesting “reflects a maturity in Chinese” electronic intelligence gathering, the expert said. “You have to put in place structured data repositories. You have to have big-data management tools to be able to store and sift and analyze.”

Barger said that “with a large pool of data, they can prioritize who is the best to target electronically and who is the best to target via human recruitment.”

The U.S. official noted that the Chinese “would not take [the data] if they did not have the opportunity to aggregate it.” And, he added, “they are taking it.”

Simon Denyer in Beijing contributed to this report.

Ellen Nakashima is a national security reporter for The Washington Post. She focuses on issues relating to intelligence, technology and civil liberties

space otter

total agreement with you Shasta..i didn't understand when they sent guys over there to show them how to make steel.. and then complained about china dumping steel ..you just wonder who the hell is in charge here..

anywho here's another little story this guy was selling ppg paint secrets to them and now he's dead.. very suspicious in my book as he was very brash and outspoken about it..I think he just may have had help..

As a result of a Saturday afternoon autopsy, the Allegheny County Medical Examiner's Office ruled that Rukavina, 62, a retired PPG Industries chemist, died from asphyxiation by hanging himself, an electronic monitoring device still looped around his ankle.

FBI agents arrested Rukavina on May 7, alleging that he plotted nearly a year ago to sell PPG “Opticor” manufacturing plans to J.T.M.G. Co., a glass-making competitor based in Jiangsu, China.

One of the largest technological leaps for PPG in a half-century, the transparent plastic Opticor is used in a range of specialty windows, from high-speed trains to military jets.

PPG is the sole worldwide supplier of it, and Rukavina was on the Opticor development team, retiring in mid-2012 as PPG ramped up production. Because of its importance to national security, the State Department bans the transfer of Opticor secrets without a special permit.

In the criminal complaint supporting his indictment, federal agents maintained that Rukavina reached out to the Chinese and offered to turn other unnamed American experts to aid competitors abroad. In one email intercepted by investigators, Rukavina pledged the Chinese “access to all of PPG technology since 1947!!,” according to court documents.

U.S. Attorney David Hickton in Pittsburgh told the Tribune-Review that the FBI will continue to spearhead the spy probe but couldn't be more specific due to the “sensitive nature” of the case.

Rukavina's suicide ends the criminal proceedings against him, but Hickton said the investigation will highlight the “top priority to protect the intellectual property of companies in this country.”

Trade secrets shipped to China hurt American workers and investors, he added. The Chinese embassy did not return messages seeking comment.

For 20 days after his arrest, Rukavina remained in the Allegheny County Jail, pending a psychiatric examination. His attorney, Lee M. Rothman, said Rukavina's struggle inside the jail with insomnia, severe anxiety and chronic depression hampered his ability to forge a defense.

He believed that Rukavina could get better care under house arrest. Concerned that he would harm himself, federal prosecutors opposed his release.

On May 27, U.S. Magistrate Judge Maureen Kelly allowed Rukavina to drop his request for a competency hearing, letting him leave jail on a $100,000 unsecured bond. However, she ordered Rukavina to surrender his shotgun to Rothman and to forgo “excessively” drinking alcohol while confined to his home.

When contacted by the Trib, Rothman declined to discuss the case. Rukavina's relatives did not return messages seeking comment.

Despite opposing Rukavina's release, Hickton said no one should be blamed for Rukavina's “sad and tragic” death.

Carl Prine is a staff writer for Trib Total Media. He can be reached at 412-320-7826 or cprine@tribweb.com.

A federal judge Tuesday released a Plum man on a $100,000 unsecured bond after a determination that he is competent to stand trial on charges of selling industrial trade secrets to a Chinese company.

A retired PPG Industries chemist, Thomas Rukavina, 62, contacted J.T.M.G. Co. of Jiangsu, China, via email and offered to provide the company with a list of technologies, prosecutors say. The Chinese company makes glass for automotive and specialty purposes.

He provided the company with technologies associated with airplane windows and high-speed trains that are worth millions of dollars to PPG, prosecutors contend.

Federal agents arrested Rukavina on May 7. He was being held without bail pending a psychiatric examination. He was suffering from severe anxiety, depression and insomnia to the point that he had trouble talking about his case, his lawyer, Lee Rothman, said at an earlier hearing.

Rukavina withdrew his motion for a competency evaluation during a hearing Tuesday. U.S. Magistrate Judge Maureen Kelly released him on bail but placed him on house arrest with electronic monitoring.

The technology for high speed trains and airplane windows a disgruntled PPG chemist is accused of illegally giving to a Chinese company took years to develop and was worth millions of dollars to PPG Industries, according to federal authorities.

Federal agents arrested Thomas Rukavina, 62, of Plum on Thursday and charged him with theft of trade secrets.

It's a case of intellectual property theft that has tangled trade with China for decades, U.S. Attorney David Hickton said Friday.

Rukavina retired from PPG almost three years ago and has been in contact with J.T.M.G. Co. of Jiangsu, China, for at least two years, according to emails detailed in a federal criminal complaint.

The Chinese company makes glass for automotive and specialty purposes.

PPG told the FBI that the plastic window OPTICOR began development a decade ago “and was the industry's first new transparent plastic in more than 50 years.”

The company's chief technology officer told the FBI that information Rukavina shared with the Chinese company would be worth “hundreds of millions of dollars.”

Ruvakina told employees from the Chinese company that he was “forced out” at PPG.

The federal complaint includes emails between Rukavina and the Chinese firm.

“If PPG owns my brain for life, then they should pay me 2 million per year to keep it!!” Rukavina wrote, complaining about the company's confidentiality agreements.

In an email, he offered the Chinese company a list of product technologies he can deliver — including sealants and optical coatings.

Rukavina was ordered detained pending a formal detention hearing scheduled for Monday. He could get a maximum total sentence of 10 years in prison, a fine of $250,000 or both.

PPG thanked federal authorities for charging Rukavina.

“The proprietary research-and-development work done by our scientists brings great value to our customers, and ultimately impacts our position in the competitive marketplace. It is essential that we continue to safeguard and protect that intellectual property,” PPG spokesman Bryan Iams said.

The Chinese company has not been charged.

Two years ago, a private advisory panel said a growing number of intellectual property thefts, mainly by China, costs the United States more than $300 billion each year.

space otter

no make believe planets or illuminated groups here...just a bunch in the here and now and this visible dimension ready to flex some muscle and see how far they can go...

Chinese hack of U.S. network compromised security files

The Washington Post

Ellen Nakashima1 hr ago

The Chinese breach of the Office of Personnel Management network was wider than first acknowledged and officials said Friday that a database holding sensitive security clearance information on millions of federal employees and contractors also was compromised.

An official announcement about the breach is expected soon.

“This is potentially devastating from a counterintelligence point of view,” said Joel Brenner, a former top counterintelligence official for the U.S. government. “These forums contain decades of personal information about people with clearances. ..which makes them easier to recruit for foreign espionage on behalf of a foreign country.”

Last week, the Office of Personnel Management announced that a massive database containing personal information of roughly 4 million current and former federal employees was hacked. Privately, U.S. officials said that the Chinese government was behind the breach.

The breach of the data system announced by OPM last week affected 4.1 million individuals--all 2.1 million current federal civilian employees and 2 million retired or former employees. Information of officials as senior as cabinet secretaries may have been breached. The president’s and vice-president’s data were not, officials said.

The second OPM database that was breached contains sensitive background check information --called SF-86 data --that includes applicants’ financial histories and investment records, children’s and relatives’ names, foreign trips taken and contacts with foreign nationals, past residences and names of neighbors and close friends.

That database was also breached last year by the Chinese in a separate incident and the new intrusion underscores how persistent and determined the adversary is in going after data valuable to counterespionage.

“That database is very huge and very old and it has lots of interfaces to it,” said a U.S. official, who spoke on condition of anonymity because of the ongoing investigation. So figuring out exactly what part of it was breached has taken some time, the official said.

Employees of intelligence agencies such as the CIA generally do not have their clearance checks records held by the OPM, though some do, officials said.

“That’s the open question--whether it’s going to hit CIA folks,” said a second U.S. official. “It would be a huge deal. They could start unmasking identities.”

The administration timed its announcement last week to comply with its own policy, as reflected in proposed legislation, to notify individuals of a breach within 30 days of determining that there is a “reasonable basis to believe” that people’s personal information has been compromised, the U.S. official said.

Though the breach was discovered in April, it was not until early May that the FBI, OPM and Department of Homeland Security determined that employees’ personal likely were taken. That led to the announcement last week even though, the official said, the investigation was not complete.

“In an ideal world, people doing the investigation would say ‘We need to wait until we’re completely done,’ “ the official said.

A senior DHS official briefed Congressional staff last week and tried to explain why it took four weeks to alert employees to the breach. “It takes time to do the forensics and to understand what’s happened, and even to understand what data, if any, has been exposed,” said Ann Barron-Dicamillo, director of the U.S. Computer Emergency Readiness Team, according to notes taken by a Congressional aide. “It’s a lot of data. It takes time for DHS and all the partners to analyze that data and come to a conclusion.”

The breach, she said, took place in December. “It took awhile to pinpoint what actually went out the door because it happened six months ago,” she said.

The hackers who recently launched a massive cyber-attack on the U.S. government, exposing sensitive information of millions of federal workers and millions of others, may have used information stolen from a private government contractor to break into federal systems, according to sources briefed on the matter.

Authorities suspect the hackers, likely from China, entered the U.S. Office of Personnel Management’s computer systems after first gaining access last year to the systems of KeyPoint Government Solutions -- one of the primary providers of background checks for the U.S. government, sources said.

Authorities, meanwhile, believe hackers were able to extract electronic credentials or other information from within KeyPoint's systems and somehow use them to help unlock OPM's systems, according to sources.

The hackers then rummaged through separate "segments" of OPM's systems, potentially compromising personal information of not only the 4 million current and former federal employees already acknowledged publicly but also millions more, including relatives, friends and maybe even college roommates, the sources said.

OPM Hack Far Deeper Than Publicly Acknowledged, Went Undetected For More Than A Year, Sources Say

In an unrelated statement today, OPM said authorities have "a high degree of confidence that OPM systems containing information related to the background investigations of current, former, and prospective Federal government employees, and those for whom a federal background investigation was conducted, may have been exfiltrated," as previously reported by ABC News.

The fact that Colorado-based KeyPoint suffered a cyber intrusion was well-publicized late last year. But the scope of the hack may not have been completely understood at the time by even the nation’s top cyber officials, sources indicated. Last year's incident has yet to be officially tied to the recent OPM hack.

The KeyPoint incident, mostly affecting employees of the Department of Homeland Security, was first detected in September, and two months ago DHS began notifying federal employees whose personal information "may have been compromised." The notification was clear about what information was exposed: "[Your] first and last name, social security number, job title, investigation case number, education history, criminal history, and employment history; spouse or cohabitant’s name, date of birth, and social security number; the names, addresses, and dates of birth of relatives of the investigation subject; and names and addresses of friends of the investigation subject."

DHS discovered the KeyPoint intrusion only after undertaking a thorough assessment of all such contractors -- a move prompted by the hacking of another federal contractor, according to DHS.

Asked why the government waited seven months to notify potential victims, one U.S. official said it took time for authorities to conclude personal information may have been stolen in the incident.

Nevertheless, KeyPoint put in place "additional safeguards" after the intrusion was detected, and those steps should "prevent future incidents of this nature," according to the government notification.

In addition to the KeyPoint incident, investigators are also looking into whether another previously-known hack into OPM databases in March 2014 may be connected to the most recent breach.

That attack targeted an OPM system maintaining security clearance information. An OPM official, however, recently told lawmakers it didn’t expose any personal information.

Nevertheless, officials strongly suspect the cyber-attack came from China -- just like officials believe the most recent intrusion also came from China.

The most recent OPM hack is believed to have been far deeper and potentially more problematic than publicly acknowledged, sources said, with the hackers believed to have been moving in and out of government databases undetected for more than a year.

Much of the compromised data has been stored on OPM systems housed by the Department of the Interior in a Denver-area data center, sources said. And one of the "segments" compromised held forms filled out by federal employees seeking security clearances.

The 127-page forms -- known as SF-86's and used for background investigations -- require applicants to provide personal information not only about themselves but also relatives, friends and “associates” spanning several years. The forms also ask applicants if they have "illegally used a drug or controlled substance," and they require information on financial history and personal relationships.

That type of information, sources said, could be exploited to conduct "social-engineering" operations, potentially using the data to pressure or trick employees into further compromising their agencies.

Also of concern are U.S. employees stationed overseas, including in countries such as China, whose government would covet personal information on relatives and contacts of American officials living in the communist country, according to officials.

"If the SF-86's associated with this hack were, in their entirety, part of the stolen information, then that would mean the potential release of a staggering amount of information, affecting an exponential amount of people," one U.S. official told ABC News on Sunday.

Acting as the government's human resources division, OPM conducts about 90 percent of background investigations for the federal government. Information from SF-86 forms dating back three decades could have been exposed in the cyber-attack, sources said.

It's still unclear exactly what was compromised by the OPM hack, particularly because OPM officials and other authorities still don't have a good handle on how much information was actually stored by OPM in the first place, one U.S. official said.

Nearly 50 government agencies send data to OPM for storage in some form, according to the official.

The intrusion was only noticed after OPM began to upgrade its equipment and systems. As soon as anomalies within the systems were noticed, the Department of Homeland Security and FBI were notified.

Over two weeks, OPM will be sending notifications to the estimated 4 million current and former government employees whose "Personally Identifiable Information" may have been compromised by the hack.

And "since the investigation is ongoing, additional PII exposures may come to light," an OPM official acknowledged Sunday. "In that case, OPM will conduct additional notifications as necessary."

In a statement last week, an FBI spokesman said, "We take all potential threats to public and private sector systems seriously, and will continue to investigate and hold accountable those who pose a threat in cyberspace."

Spain’s unused, billion-euro Don Quixote airport is about to be sold to a Chinese investor for just $11,000

In 2006, amid a construction boom in Spain, a tiny town with a population a little over 75,000 people an hour outside Madrid built an airport for €1 billion ($1.1 billion). The town, Ciudad Real, at the time named the new airport after Don Quixote, the windmill-fighting fictional character famous for his delusions of grandeur.

Fittingly, it turns out.

Just a few years later, the construction boom turned into a bust when the bubble burst, making Spain one of the hardest hit countries as the financial crisis swept the world and effectively mothballing the airport.

Now, a Chinese investment company is set to buy the airport former known as Don Quixote—for a paltry €10,000, or $11,000. In fact, it was the only bidder.

The deserted airport is one of the more famous examples of the boom—from apartment complexes to highways—that have given much of Spain the feeling of an empty ghost town.

Ciudad Real airport was built to handle more than 10 million travelers a year. It even has a runway large enough to hold the world’s largest passenger airplane, the Airbus A380—but the airport has sat almost unused since its opening.

In fact, Ciudad Real airport is not even the only deserted brand-new airport in Spain. Both Lleida–Alguaire Airport in Catalonia and Castellón–Costa Azahar Airport near Valencia remain practically unused since construction, The Guardian says; the first commercial flight took off from Castellón airport this year, over four years after opening.

Chinese investment company Tzaneen International was the sole bidder for the airport in a public auction. The price includes the majority of the airport grounds and buildings—but Tzaneen says that it is ready to invest up to €100 million in restoring the airport, which it hopes to turn into a European hub for Chinese cargo planes.

The deal is not done, however. The airport was put originally put on sale for €110 million, but later revised down to €40 million. Because Tzaneen’s lone offer was less than 70% of the asking price, potential competitors have 20 days to come up with something better.

If no-one steps forward, Tzaneen will have its own state-of-the-art airport for the same price as a used 2015 Nissan Versa.

In Mark Kapchanga's view, the West, particularly media, really do not understand what the Chinese are doing in Africa. Kapchanga, a provocative Nairobi-based journalist and columnist, isn't shy in arguing his case that on balance China's presence in Africa is a net plus for the continent and its people. The West, he says, just doesn't have its priorities right in Africa, whereas Beijing's massive infrastructure spending across the continent is the kind of engagement that has a direct impact on people's lives.

Kachanga writes a regular column in the fiery Chinese state-owned newspaper The Global Times that unsurprisingly takes a stridently pro-PRC stance. Although the Kenyan journalist does have some critical views of Chinese policy in Africa, few if any of those opinions make it past the newspaper's censors.

So while Kapchang's outlook on Sino-African relations in print may be filtered, he doesn't hesitate in the least when he joins Eric & Cobus -- in the podcast in the audio above -- for a full debrief on his views about the state of the Chinese in Africa.